To be sure, Jaffray researchers are drawing data from a tiny segment. Netflix is believed to have somewhere around 24 million subscribers. The bank said a survey of 350 subscribers in August--after Netflix had announced it would eliminate a subscriber plan that offered access to DVDs and streaming video, which would raise prices for some--showed that 15 percent of respondents planned to cancel.

Netflix said it would deliver streaming video over the Web while a new service, Qwikster, would oversee DVD-by-mail operations. This stunning revelation, coupled with the earlier price increase, was too much change for many subscribers and many responded by cancelling.

In a survey taken on September 19, Jaffray reports that the number of people who said they plan to quit Netflix is down to 10 percent.

"We believe our survey shows that subscriber cancellations are stabilizing after being higher than expected for the majority of Q3," Jaffray wrote in its report. "While we continue to expect elevated churn over the next few quarters, the risk of a mass exodus appears to be moderating following our mid-September survey."

Investors don't seem to see rainbows yet. In early trading today, Netflix's stock set a new 52-week low at $112.58, down more than 11 percent. In July, shares were going for $304.

The slide in Netflix's stock is likely due to Amazon's announcement yesterday that the retailer was launching a series of new Kindle e-readers, including the Kindle Fire. The company is not only selling this tablet and iPad competitor at a low price ($199), it is also including in the purchase a free month of Amazon Prime membership.

Fire owners will get free two-day shipping on any store purchase and also receive unlimited access to a streaming library of 11,000 movies and TV shows. If they want to sign up permanently to the service, they can pay $79 a year. Netflix's streaming service costs $96 per year.

As for whether there's an end in sight to Netflix's troubles, company managers predicted in July that eventually their customers would move past all the new changes and even some of those who cancelled might return.

One thing for sure is anticipation for Netflix's third-quarter report is going to be high. Everyone will want to see the extent of the damage.

About the author

Greg Sandoval covers media and digital entertainment for CNET News. Based in New York, Sandoval is a former reporter for The Washington Post and the Los Angeles Times. E-mail Greg, or follow him on Twitter at @sandoCNET.
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